What Are Common Obstacles Applicants Face For EB-5 Application?

The main obstacle is how someone would be able to choose the best investment option among hundreds of options. Most client investors ask me to please pick one for them, or they would say, “If this was an investment for your mother, what would you tell them?” I would tell them my mother is very savy on investments and that I go to her for information. Most people are very satisfied with the idea that they have licensed security brokers-dealers to give them options of different EB-5 investments in order to assist them in making the right decision for themselves.

What Are The Current Requirements Relating To Request For Evidence (RFE) Issued By The USCIS And How Many Years Does This Go Back?

The usual reason would be regarding source of funds, like in the property example I gave earlier. Maybe 3 or 4 years ago, it used to be that if someone owned a piece of property for 6, 7, 8 years, they would need to be able to show where they got the money to buy that piece of property.

It then changed to the person having to show that they had owned the property for more than 10, 12 or 14 years. If the person owned it for that long and then sold it, they would not have to show where they got the money from that. It has now shifted in some cases, to over 15 years. So that if someone owned a property from over 15 years before, they would not have to show from where they got it. Immigration always says it would depend on the facts of the case, so when we can, even in older property situations, we would always see if the person had any documents regarding where they got the money to buy the investment even if it was a long time ago or we certainly tell the story of it.

On the property side, I can give an example of the part that has changed over the years. The changes have happened with hotels primarily because 5 years ago or so, the investor would be able to raise 100 percent of the money through EB-5 to build the hotel. Without any notice, Immigration changed the rules and said that this could no longer be done except for very extreme situations, because what was really happening was that if the person opened a new hotel, they would be taking jobs from an older hotel in the area to the new hotel, so they would not really be creating new jobs.

Another rule change has happened more recently relating to a new criteria for how the person would have to document money they received through a loan. Unfortunately, Immigration does not give people any notice and they do not inform that they are starting to apply a new rule on loans or they are starting a new rule relating to occupancy on hotels and the new rules would apply to all cases filed after a certain date. This is unfortunately not the way they work, because they would apply a rule and it would be retroactive. A person could get denied even if they had filed case based on the rule that had been in existence for years.

A class action has currently be filed by a lawyer in regards to the new rule relating to loans, and because this has affected the number of applications in projects. It is an issue that attorneys and developers are always fearful of with regard to the project side and also regarding the source of funds.

Why Has The Government tightened Its Scrutiny Surrounding These Things?

The government has certainly scrutinized these areas in relation to the source of funds and also the project side, because there has been some abuse. There have been investigations of EB-5 projects where developers have not followed through as they should have, so a lot of people have been affected because of a few bad actors. This does not relate to the rules Immigration changed midstream, it is just a reason why they are being tougher on adjudication. This would also relate to security’s interests and for Immigration to make sure there was no laundered money and no drug money, which of course we and everybody in the business does not want either. But often, they go overboard in requiring proof of the source of funds when it is very evident that it was income from business, from savings or from selling a piece of property 15 years ago; nobody put drug money in a property 15 years ago with the intent of getting a green card today.

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